The Nigerian Senate has passed the Finance Act (Amendment) Bill, 2024, which includes a significant change in the taxation of banks’ foreign exchange gains. This decision came after the consideration and adoption of the report presented by Sen. Sani Musa, Chairman of the Senate Committee on Finance.
The bill, initially proposed by President Bola Tinubu and read at the plenary session on July 17, 2024, aims to amend the Finance Act of 2023. One of the primary objectives of this amendment is to impose a Windfall Tax on banks’ foreign exchange gains. The levy charge for this tax has been increased from the previously proposed 50% to 70%.
The additional revenue generated from this windfall tax, estimated at ₦6.2 trillion, is intended to finance the Appropriation Amendment Bill. This move is expected to provide a substantial boost to the government’s finances, tapping into the profits banks make from foreign exchange transactions.
The Finance Act (Amendment) Bill, 2024, thus represents a significant shift in the taxation policy, targeting the financial gains of banks to support broader fiscal measures.